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tv   Mad Money  NBC  November 24, 2015 3:00am-4:00am CST

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ruth and phil are here. >> tomorrow, the property brothers. >> plus, elvis durant has his artist of the moment. >> we'll see my mission is simple -- to make you money. i'm here to level the playing field for all investors. there's always one somewhere and i promise to help you find it. "mad money" starts now. >> hey, i'm cramer. welcome to "mad money." welcome to cramerica. my job is not just to entertain but to teach and coach y. call me at 1-800-743-cnbc or tweet me @jimcramer. a day like today where the averages initially drifted higher for selling off in the afternoon. dow closing down 31 points.
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nasdaq dropping 0.5%. this morning we learned in a total blockbuster of a deal. that pfizer is trying to reinvent itself by buying allergan, agn, to be more efficient with overseas capital. allergan gives them a way to do that. it cost them a pretty penny, the company is confident this is a good one. allergan has an excellent vaccine and cancer franchises, including their benchmark drug, botox, which they haven't raised the price up, while simultaneously keeping up with new uses for the darn thing, past wrinkles and migraines. perhaps they can run into a new form of company with this merger
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that's what the hope is. in the meantime you're being paid to wave dividends that nets 3.5%. the market doesn't like this. absolutely doesn't like this deal. >> for real allergan shareholders because it's delighted with phaser before it closes. and potential government challenge over the tax avoidance scheme. we believed in brett saunders' aspirational earnings estimate. the ceo laid that over and over again, including on "mad money." that's something that frankly is no longer a factor. i still believe in brent saunders. still believe in allergan money, but pfizer makes the turn much more convoluted. the cut and run crowd and arbitrators will think otherwise, but i totally understand the frustration of
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allergan shareholders who were really pretty furious, come to think of it. but pfizer is bag allergan is the biggest example today. alcoa which has been producing aluminum since 1886. under the ceo, they have been trying to reinvent the use of the metal. finding way to integrate it into trucks. the ford f-150 made with aluminum was awarded green truck of the year because it lightweighted with alcoa aluminum. they were the underdog. they bulked up on aerospace and earlier this year they decided to split raw material side of things from the proprietary aluminum engineering side. my "squawk on the street" david faber broke that elliott singer bought a stake in the company and seeking constructive dialogue with company. he believes alcoa -- they think it will be worth a great deal more than kleinfeld indicated
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when he came on our show last month. i don't think he disagrees. i've been welcome any dialogue to create more value, sit down with elliott management. that said, the stock has been a terrible performer, both before and after. the world will number a deficit position with alluminum because of increased use but chinese confound people with excess sales of aluminum. there's no reason for him to bring out more value until we see the separation. i don't know how they're going to do that until you see the two different halves. candidly, i think this was an odd one because the activist is trying to reinvent the reinvention. alcoa's more than 4% bounce. diebold which reinvented itself as automated tellers and today they bought wincor nixdorf, a german company, for $1.8 billion
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in cash and stock, making it the largest atm maker. europe's coming back. diebold needs more scale. this is exactly what it needs. i can't wait to speak to the company ceo andy mattes. part of the reinvention has been on the software side. being the biggest atm maker eclipsing acr with 1 million cash machines around the world will help that software and services component. it's a big deal at a big price but diebold has to be bigger if it's going to dominate. talk about cutting it down to one-third of the current size in order to get the deal done and growth mode and fix the balance sheet. a lot of people own diebold so you're probably disappointed. but if this company can reinvent itself with more of a growth angle, that's going to attract a whole new cohort of investors. or the story of deluxe, deluxe corp, the old deluxe check. it rang the bell. they're trying as fast as they
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can to be more than a check printer. i think they're succeeding. i'm going to sit down with leo schramm to see how far the company has come and where they can stay one step ahead of the plastic posse or more than that. either way, deluxe understands they can never stop reinventing themselves as long as the check business remains in secular decline. now, let's consider a stock that got slammed today and many of you are talking about. gamestop, down 4.2% on a mixed quarter which has to be regarded as a step back for this company's attempt to transform and reinvent itself into something more than just a retailer that sells games. that's no easy feat when video games are in your dna and you're hostage to a game rollout schedule. now, i think the reaction here in this stock was down badly might be overdone. especially since gamestop maintained their full-year guidance despite the miss and said november was stronger than expected. still the market has spoken.
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it's not encouraged by the reinvention the ceo has been trying to put through, at least not yet. given the cheapness of the stock, the yield, the humongous side of the reward position, i think you have gains as i told you last friday's "game plan." i am shocked that commodity chicken provider tyson's provider of hormel brands didn't give them more of a boost when it reported today. that said, the cost of feed down, the prices of chickens up, this was a truly blowout quarter for tyson. disputed the lack of a boost from the hillshire acquisition, which was hurt by higher meat costs and lower margins. the reinvention didn't pay off president the legacy business did, hence the astounding 10% gain in the shares. some reinventions happen on the fly. we'll hear from campbell's soup and general mills, to become more natural and organic.
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it's a work in progress that i think will ultimately be successful. hormel is ahead of the pack due to applegate farm. here's the bottom line. i love reinvention. it's how companies turn themselves around and take things to the next level. yet the one thing we know from every one of these companies is that reinvention doesn't happen overnight and people get very impatient. sometimes it doesn't happen at all. these reinventions they require great skill. it's not easy. but it can happen. when it does, shareholders like you get rewarded. like we're seeing in the case of hormel's move into the natural and organic space. i bet ultimately we'll see it in most of the other makeovers i just mentioned. let's go to questions. patricia in new jersey. >> caller: yes. i have verizon stock. today i see it's trading at $44.99 a share. >> right. >> caller: i would like to sell
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do you see the stock going up much in 2016 or do we hold on for a while. >> i have to tell you, i would hold onto that. 5% yield, doing so many good things. good growth plans, balance sheet is getting better. i don't know. even if the fed raises, i still think verizon is a good stock. i would not sell that stock. steve in new york. steve! >> caller: hey, jim. i've been making money with you for ten years, jim. you're the best. >> thank you. thank you very much. >> caller: when the moon is blue i get stuck and i need help. >> sure. >> caller: buy, sell or. >> we said it was undervalued, went up a lot, pulled back. do you do it again? this market no longer finds these stocks in a favorable light. i have a have dozen just like this. i would not sell it at a 52-week low. luke in washington. luke! >> caller: booyah, jim.
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>> booyah. >> caller: hey, i've had my eyes on spirit airlines for a long time. high cash flows, you know, high margins, low/peg ratio. >> the last time mr. maldonzo was on, when the stock was around here, i thought absolutely the case is a good one to buy. and i think i am with you, luke. save goes higher. reinvention is not easy. have you to be a little more patient. when a company does it right, shareholders like you get it right. i'm making a list and checking it twice. find out which uptakes. facebook, amazon, netflix and old google can't seem to quit. and allergan and pfizer weren't the only ones hitting the tape. i'm sitting down with the ceo of diebold to talk about the company's latest acquisition and why i think it will work. so why don't you stick with
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cramer. >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter. have a question? tweet cramer #madtweets. send jim an e-mail to madmoney@cnbc.com. or give us a call at 1-800-743-cnbc.
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head to madmoney.cnbc.com. even the most troubled companies can change their stripes. continual theme tonight. first, they need to know how to turn themselves around. take ibm. an old technology company with a stock that's been stuck in a brutal long-term downtrend, off more than 35% from its all-time high. all of this time, what has ibm done in order to make a comeback? mainly ibm has spent money buying back its own stock. an insane amount of stock. they should consider changing the name international buyback machines, might be more fitting. i think there's more of a positive and constructive path for ibm to turn itself around. in order to make that happen, management needs to put its money to work in a more intelligent way, my own view. if ibm's business is declining, and it is, then buying back stock isn't going to fix things.
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they have made a huge string of acquisitions, i don't think they've bought big enough. after these last years of disappointment, my view is it's time to get more aggressive up to the 40% to 50% region where ibm stock can fly on its own without the need for endless buybacks. ibm needs to acquire other sizeable companies with rapid growth without breaking the bank in order to shrink exists businesses. i'm going to do the ceo of ibm a huge favor. i'm going to give her my shopping list of tech companies she should acquire so ibm can get its much-needed mojo back. let me explain why ibm is in trouble and how they have the chance to be better. smaller, more nimble companies chip away at the company's market share and big boost struggles to pivot into faster growing businesses. that's why they haven't been able to deliver a single quarter of positive year over year revenue growth since the first
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quarter of 2012. that's 3 1/2 years. some declines were deliberate as they divested some slow growers. while ibm sales are on the decline, the company still does one thing very well. it generates an enormous amount of cash. at the end of september, $9.6 billion on balance sheet and first quarter of 2015 they managed to generate $11.7 billion cash flow from operations. that's where painless transformation can come from, provided the money is spent differently than currently. ibm doesn't know what to do with their cash. more importantly, they don't do the right thing. they bought back stock, warren buffett. they would be better served putting those billions to work, making smart acquisitions so potential growth fans who need to be brought into that stadium. and still have billions left over for their buyback and keep warren happy.
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last year ibm spent $13.7 billion purchasing its own stock. the year before that, $13.9. the you're before, $12 billion. the revenues continue to shrink and the stock goes lower. that's a darn shame because there's better things they could spend their money on. $14 million a year. they could breed new life into this old technology company and move that needle for the fast growers within the operation, which brings me to my shopping list. i have five potential takeover targets i think could revitalize ibm's business starting tomorrow. for starters,fy were big blue, i would snap up box. it's down because the market hates these kinds of stocks, only at $1.75 billion. that's the amount ibm spent on buybacks. it's small but dominant player in the cloud. box's platform works across most devices, including apple and android and they have tremendous growth to spend about $42% in the last quarter.
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we know ibm announced the acquisition of clever safe. that's another cloud storage player. for an undisclosed sum earlier this month with the plan being to integrate cloud safe into the cloud business. i think they can do the same thing with box but acquiring a higher quality product, one that would help ibm boost its relevancy -- let's say, in this segment for the 21st century. plus i think being part of ibm could be good for box because it would allow them to crack into the more profitable area. they obviously like each other. i say bring box in, keep the hard-charging aaron levy at the helm. next up if i were running ibm, i would be eager to get into the rapidly growing cyberspace. cyberark, israel security company that has carved out a niche, for privileged accounts.
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ibm can swallow them up for a song, down 46% from june high. that's courtesy of the vicious decline. in cyberark's case, the company's recent quarter was terrific and magnificent 64% growth rate. fireeye came out with good numbers. i bet the good numbers from palo alto that came out tonight can change that around. ibm builds itself as a leader in itc security, this has the appearance, not actuality, an afterthought of acquisition for ibm. i think cyberark would give them a stronger footprint, particularly with ibm's many government clients that might be more with hackers. i think it could be so crucial for ibmf i were them, i would double down. i would snap up imperva, another cyber leader that products
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applications. that's right in ibm's wheelhouse and it's a $2.3 billion, chump change to ibm but magnificent revenue growth and that could offset ibm revenue declines. they focus on data protection, makes it a perfect fit for ibm. oh, and they're actually profitable. that might make it easier to swallow. given how the stock has been roar, i think ibm needs to move sooner rather than later. like tomorrow. fy were ibm, i would snap up a big competitor in the data analytic space. maybe the $3 billion click technologies or -- i don't think they want to sell -- $6.9 billion tableu software. they have been taking shares from ibm in the analytics space. if you can't beat them, buy them approach. still 7.9% revenue growth. we know ibm has been pouring money into watson, which has
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financial services capabilities. but an acquisition of a click or tableu could get people excited again about the company, certainly more than the weather business they just bought. that did not move the needle. maybe the most formal name in cognitive data analytics but it's important to take out the competitors. ibm, the bulk of your business is in decline and you can't solve that problem with buybacks but you can fix it by buying other companies. that's why they should acquire box, cyberark, tableu or all of the above p they can afford it. i'll even wave my investment banking fee tonight because in the end, this deservedly proud company has a history of reinventing itself and i think these acquisitions, not more buybacks, will provide the answer. much more "mad money" tonight. it's a bird, it's fang! i'm telling you why it can't be explained by numbers alone.
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allergan and pfizer were the talk but diebold made a merger. and the launch corporation celebrated 100-year anniversary. how have they kept themselves around in i'm getting the answers. stick with cramer. i have asthma... ...one of many pieces in my life. so when my asthma symptoms kept coming back on my long-term control medicine, i talked to my doctor and found a missing piece in my asthma treatment. once-daily breo prevents asthma symptoms. breo is for adults with asthma not well controlled on a long-term asthma control medicine, like an inhaled corticosteroid. breo won't replace a rescue inhaler for sudden breathing problems. breo opens up airways to help improve breathing for a full 24 hours. breo contains a type of medicine that increases the risk of death from asthma problems and may increase the risk of hospitalization in children and adolescents. breo is not for people whose asthma is well controlled on a long-term asthma control medicine, like an inhaled corticosteroid. once your asthma is well controlled, your doctor will decide if you
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behind the running facebook, amazon, google and alphabet. it should be a case study as stocks develop a scarcity value that can't be trumped by the four walls of the spreadsheet. these high flying stocks become modern art of professional sports sheets. they can't be explained by simple numbers can absolutely be understood from the. speculative there just aren't enough trophy properties to go around. last summer i had a discussion with an nfl team owner, one i consider the brightest around. we were talking about how the price of a nfl team goes higher. i postulated that at some point there would be a valuation. he requested my judgment. he said i should evaluate the purchase of clippers by steve ballmer. he mentioned a clippers -- they were a mediocre team. then ballmer by his investment with microsoft stock from ages
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and ages ago, had the money to snap up the franchise for what looked like an unbelievable sum. if he had held onto microsoft he would have had a $400 million gain on that investment since the purchase of the clippers. however, ballmer couldn't pass up the chance to buy the clippers because of the scarcity value. my staff can't stop using the video of him dancing. is that dancing? you decide. nba teams just don't come up for sale very often. they are the, owners said, like plastic paintings. their availability or lack thereafter sets the price. in that sense it's like the reclining nude that sold at auction for $170 million earlier this month. but he won't be painting any more reclining nudes any time soon. turns you back to the psychoeconomic value of fang. it's not all of these companies are doing well. it's that no other recent vintage tech company or that iteration is really challenging facebook, amazon, netflix, google for streaming. what has facebook done in the
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last couple years? they spinned their way into an unsalable ridiculous profit made up of content mostly on mobile. facebook is the most sophisticated delivery system of yourself. potential challenge was instagram, they bought that for chump change three years ago. maybe snapchat poses a legitimate threat. can it come public at the last price of $16 billion? we don't need another facebook. how about amazon, all-time high today. at various point we thought other companies could challenge amazon, particularly walmart with its supply chain. we learned a company even with billions at its disposal could do it. walmart will try to compete with amazon, even if it's half-heart or the giant retailer wouldn't be spending $20 billion to buy back stock. amazon bought distribution. that was worth a whole lot more. netflix's stock got hammered when hulu said something about getting in bed with them but
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netflix has rallied. what a testament to the creativity that it's done one sequel to every original program it's produced. netflix has another hit on its hand and i'm hearing good things about the marvel series with "jessica jones," and the artist formerly known as google. how many companies try to dominate search? how many try to take over with programatic selling? alphabet can spend all on next generation while monetizing youtube. meanwhile, how about all those privately held u.n. corner challengers like uber and airbnb. i see more companies like square, total commodities that can come public and languish. there's a glut of unicorns but a tremendous short of profitable
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growth internet plays. psychoeconomic explains of fang and explains the weakness of square. yes, there are too few of the former and too many of the latter. john in florida. john! >> caller: booyah, cramer. i would like your opinion of wwe, world wrestling entertainment, is it time for me to increase my positions? >> you know what, people keep trying to get me to bite on this one. it has come down but it's up. i think it's in the middle of the range and i don't see anything special to make you have to do that, frankly. how about jerry in west virginia. jerry! >> caller: hello, jim. how are you today? this is jerry from almost heaven. >> all right, what's happening? >> caller: my question for you, jim, is about skywork solution. i first heard about skyworks on your show several years ago. and i want to thank you for that very much because i've done very well with the stock. >> excellent. >> caller: but over the last
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several months the stock has corrected, the earnings have been guide, guidance is good and buying back $400 million in stock. but the stock's not moving up. in your opinion, jim, what do you think the reason is for this -- >> i think it's too close with cell phones and people decided cell phones peaked. not that no one will continue -- there won't be new buyers of cell phones but there's a level of sat race to skyworks is regarded as being saturated. i disagree, but i'm not getting in front of that freight train. let's go to sid in california. sid! >> caller: yeah, hi, jim. i'm a long-time viewer. >> thank you. >> caller: first-time caller. thanks for all your helpful advice. >> thank you. >> caller: i wanted to ask you about the currenstatus of the planned -- or announced distribution by alcoa of their -- i mean, of yahoo! of their alibaba shares? where does that stand now? >> we actually don't know.
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i think that's one of the reasons why everything is in flux. they're trying to get a ruling, trying to do it ahead. some people say there could be severe tax consequences. me, i think you own yahoo! and sell alibaba, because i think there's something left to yahoo! but i seem to be very lonesome in that position. sometimes all that matters is when a stock develops a scarcity value. that's what's behind fang supremacy. much more "mad money" ahead. forget about lengthy passwords. nothing can stop criminals until now. i got to play with diebold's ceo. a company that works with over 4 million small businesses. the ceo of deluxe. the old deluxe check print. find out what he's -- >> announcer: tomorrow kick off the trading day with "squawk on
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the street." live from post nine at the nyse. >> you know, don't put the ifp in. >> no. that's the ear piece. everybody has to answer questions.
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eastern. allergan and pfizer weren't the only one hitting big merger announcement today.
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we got news diebold, largest manufacturer of atms and the u.s. and many other countries, is buying wincor nixdorf. it's a german company another leading provider of hardware, software and services to banks and retailers. including atms. $1.8 billion cash and stock deal. diebold has been undergoing a massive multi-year turn-around. 160 million in cost synergy expected bit end of the third year after the deal and the geographies, they're very complementary. diebold is a major player in the americas while wincor is big in europe. i think this could have the diebold got slammed today, down $2.51. that was in part because their issuance of new stock and also because they announced a dividend cut. is this a buying opportunity or should we be wary? let's take another look with andy mattes, ceo of diebold. mr. mattes, welcome back to "mad money." good seeing you again.
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saying, here's where we are. we're crawling. what are you doing now? >> we're walking, jim. >> so what's changed? >> the biggest thing about walk is that we're shifting our revenue mix from hardware to software and services. and the second thing is, that we're doubling down on our portfolio and making sure we get the right elements into our portfolio that will have higher margin business opportunities going forward. >> with this acquisition i noticed the company you're buying, wincor nixdorf, dominant company for banks in europe, but dominant for retail. what are they doing for retail? you have a couple of retailers, too, cracker barrel, cinemark chain. what are they doing in retail that you can do in retail here? >> they have point of sale solutions in retail, but most important they have back-end cash automation in retail. because once you get the money out of the cash register back into the back office, there's a
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done today. wincor has a great automated solution. they're selling to the premiere retailers in europe. one of their marquee logos is ikea, the swedish furniture store. and we can offer right off the bat great service capabilities to all of the wincor nixdorf retail customers around the globe, plus we can combine some offerings with the retail opportunities that we have, like walmart deal we announced earlier this year. >> the cross-cell looks pretty terrific from your point of view? >> cross-sale is terrific on the retail side and more importantly, cross-sale is terrific on the services side. if you look at the services attach rate, the number of times people buy a service contract with your machines, diebold has a much higher service attach rate than wincor. if we can do nothing but raise the wincor attach rated to the diebold attach rate, we'll create incredible service opportunities.
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>> you're faster growing with. . a lot of people did love your higher dividend. worth it at this point because of the cash flow and what you -- you don't want -- you've got to pay down some debt so it's the prudent thing to do right now? >> that's exactly what it is. once we consume the deal, we'll have a four times debt-to-ebitda ratio. we made a commitment on our earnings call today that we're get to sustainably three times debt-to-ebitda within the first three years of the transaction. and reducing the dividend for that period of time is just prudent thing to do. >> when you talked last time, biometrics of millenials. you seen have a slide in your presentation about millennial-inspired atm concepts. where are we with those? >> we just announced at money 200 a next step where we introduced the first atm into the market with iris recognition together with citi labs. it was a huge success because it
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increases the safety and security while increasing the convenience for the customer and in addition to the diametrics you can also combine the atm with your mobile phone and have a secure way to interact your transaction between your cell phone and your atm. >> now, who wouldn't that? there's pushback. not everybody likes that, but to me having been hacked so many times, it sounds like a really good idea. >> it's like a no-brainer. we just have to get over it. if you look at the mobile apps, the financial apps, can you sign in with your thumb print. >> yes. >> i think user acceptance in this country is rapidly increasing. it's a level of security that we would be amiss if we didn't take advantage of. >> that plays right into what diebold's strategy is. >> diebold is a market leader in biospace in the western world. it plays right into our strategy. and combining the physical world of cash with the digital world
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we see the services that we can deliver to the market and that's where we're unique in the industry. >> one last point because i've been remiss, i know a lot of my viewers on twitter are angry i never focus on it, but bitcoin is something you guys were involved with. where is bitcoin in your eyes? if you think it's legitimate, it's legitimate. >> there are two things. first thing, bitcoin as a currency, and that's a longer debate, but there is a technology behind bitcoin called block chain. that technology is absolutely fascinating because it's unhacked. it gives a real-time journal and is an absolute secure way to transfer just about anything from one person to another in a virtual world. that can be money, that can be theater tickets, it can be anything else. and the block chain technology will be something that will be very transformative to our industry and we're spending a lot of time and energy in it. >> we'll follow up next time when you're running. i want to hear more about bitcoin because i find that
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fascinating. that's andy mattes, president and ceo of diebold. i think transformative and i think it's going to work. americans. we try to live healthy. but many of us don't know there are nutrients that can help support our metabolism. take new one a day healthy metabolism support multivitamin with chromium to help use carbs from food and b-vitamins to helpconvert food to fuel one a y. nowmenith buons, owfles wh icing can corn feathers sure look ticing
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how many ways can you snap, crackle, pop?
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it is time, "lightning round." >> buy, buy, buy! >> sell, sell, sell! >> lightning round is over. are you ready, ski daddy, lightning round. we'll start with ted in new jersey. ted! >> caller: this is ted in redbank, new jersey. first, i want to tell you, jim, that i'm blind. i've been blind for ten years, so i really can't follow the
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market that closely, so i have to do is rely on you to tell me what to buy, when to buy and when to sell. >> well, i'm honored. i hope we can do some homework beyond that. i'm honored you count on the show for that. how can i help? >> caller: royal dutch shell. i have some shares. should i buy some more? >> i don't think so. i don't think they acquitted themselves much during this downturn. i cannot emphasize enough they have not done a good job. thank you for those kind words. michael in connecticut. michael! >> caller: jim, hi. i've got a position i established, and it's doing nothing for me. should i hold or sell and move on? >> you know what, i still think that that custom made knee implants, we like that company. but i understand. you know, this is a market that likes the bigger cap guys. and i would rather see you in a bigger cap biotech. let's go to jude in new jersey. jude! >> caller: hi, jim, how are you? >> how are you?
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>> caller: happy thanksgiving. same to and you your family. >> caller: thank you. thank you for all the money you helped me make. very big question. the bank stock syf, is that -- >> yes. creating two good things with sink row any and general electric. these are both buys. let me go to paul in new york. paul. >> caller: hi, jim. from my standpoint would you comment on the progress of most-merger benefits thus far by lnte. >> you know, we like that deal. buy some here and buy some on the pullback. this is a brand new food colossus we like very much. let's go to al in new jersey. al! >> caller: hi, you doing, jim cramer. you're a blessing. >> thank you. >> caller: i want to know one thing. how come at&t got $1.88 dividend share when verizon got over $2 a share and it's one of its
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>> rememr, abet, the cash flow and what they can do that's prudent. i like at&t. it's got a great yield. and i like the directv acquisition. i think the stores are a little more crowds because of that acquisition. let's go to josh in new york. >> caller: booyah, jim. i need your. on molina health care. >> we're staying away from that. these are houses of pain, this group right now. >> the house of pain! >> we're not going to go near them frankly. as much as there might be another takeover. g.l. in indiana. >> caller: thanks, jim. canadian sole, csiq. >> this is very cheap stock. i mean, if you have -- this one is not a bad stock to own if you want to own these. i have been way from it because it's -- you know, it's a chinese stock based in canada. i'm not crazy about it. but at least it is very cheap. let's go to don in hawaii. don. >> caller: aloha, cramer. i have much respect for you. i've been following you for years.
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>> too low to sell. if we get another dip to 95, we'll pull the trigger. i think you have time. let's go to greg in florida. >> caller: booyah, dr. cramer. thanks for helping with the health of my portfolio. nimble. >> wow, that was a really bad quarter. i don't know. the stock -- wait until -- if you really want to be in there, wait until the end of tax law selling but that was a bad quarter. and that, ladies and gentlemen, is the conclusion of "the lightning round." >> announcer: "the lightning
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start the relief. ditch the misery.
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and windows can be incredibly difficult endeavor, which is why so many fail. there's also tremendous opportunities when it comes to small businesses succeed and that's where deluxe corp comes in. here's a company that's now 100 years old. they just rang the bell at the nyse this morning to mark this anniversary. deluxe used to just be a check-sprinting play but they've been expanding where they now have a whole suite of products and services designed to help small businesses and financial -- the transformation continues. giving the stock is trading just 12 times next year's earnings estimate, you could get a tremendous bargain. let's check in with lee schram, ceo of the deluxe corp. let's see how it's doing. >> hi, jim. >> have a seat. >> thank you. >> it really is today. today is the birthday. >> it's actually today. 100 years today, november 23rd. >> what's the company look like
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>> versus what? >> then, when you started. >> incredibly inventive, unbelievable changes. >> when you say you're helping out small businesses. there's lots of different decks and various reports. but what you're trying to do is help an area of the economy that is still sluggish. how do you get small business to be moving? because in the country, it's not doing that well. >> what we're trying to do is get involved earlier in the work flow. what we want to do is get to the point where we're helping them with branding, promoting and selling themselves. we only used to help with operating, checks. work flow. that's what's really getting them excited. that's where we're able to help them and help focus on growing. >> you made a key acquisition, datamix. >> datamix, is on the financial services side. but it is an exciting thing for us. what we're focused on there is really how do we help banks acquire new demand account holders. digital marketing service, is a
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focused on the f.i. space. >> i own two small businesses. have i a tavern and -- those are smaller than you but let's add a couple. what could you do for me. >> we do everything from websites to printing to marketing. so we can help you get found, get you awe website, get you online. once you get online with search engine marketing, getting people to find you and your business. we can do a logo for you so you're branding yourself we call it on demand print marking solution. it's that whole gamut, everything that helps you promote yourself and get you out to your customer. >> how do you compete against a salesforce that's doing that or wix that's designing websites. how do you get yourself known. >> it's the total package. online we're getting our customers throughout banks, getting our customers through major accounts.
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we have a distributor and find them many different ways. we think that's unique. we also think what's unique is the breadth of products. we have a lot more richness than the players you just mentioned. >> the check business itself, i mean, i know it's in decline but still generates a huge amount of cash. >> really important to us. we always tell people the story f you're going to invest in the company, have you to understand that we're managing the secular decline of check. putting a lot of technology around that right now. very innovative in terms of what we do there. then we're gaining share. we're winning share with -- in the f.i. market, so we've won suntrust, citizens, zions in recent years, and we're winning on the small business side with all those channels and channel reach. it's winning there. and then continuing to really put technology around check. and then focusing in on the new stuff we're doing. >> will checks forever be in secular decline or is there a point where it's just -- we all still carry some checks.
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i always have checks. i mean, my -- my kids have checkbooks. i mean, i have to believe that at a certain point it just stops going down. >> we don't plan it that way. we hope it's that way but we think we're smart at managing it at about that 6% decline level so that allows us to move more quickly and stay focused on the newer spaces. >> are there a company or two you can say, listen, they use deluxe small business and this is what it's done for them? >> small businesses? >> yes. >> oh, there's a lot of small businesses. >> give me an example so people say, oh, yes, deluxe -- >> my own neighborhood, basically a leather and shoe repair place. and i wear my soles terribly, so they're a huge customer of ours. they use all of our products and services. >> and the people who do t-shirts and things -- you outsource that? you actually have -- >> we outsource that. we put the logos on it but we outsource all of that. >> i have to tell you, it's a great mosaic of a business all built around -- a brand, a
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trusted brand that's 100 years old and i think people feel comfortable using. >> absolutely. fantastic story. >> thank you very much. lee schram, ceo of the deluxe corporation. you know, 100 years, going strong. thank you, sir. >> thank you, jim. so how ya doing? enough pressure in here for ya? ugh. my sinuses are killing me. yeah...just wait 'til we hit ten thousand feet. i'm gonna take mucinex sinus-max. too late, we're about to take off. these dissolve fast. they're new liquid gels. and you're coming with me... wait, what?! you realize i have gold status? do i still get the miles? new mucinex sinus-max liquid gels. dissolves fast to unleash max strength medicine. start the relief. ditch the misery. let's end this. i take pictures of sunrises, but with my back pain i couldn't sleep and get up in time. then i found aleve pm. aleve pm is the only one to combine a safe sleep aid plus the 12 hour pain relieving strength of aleve. i'm back. aleve pm for a better am. dry spray?
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after the bell we got a really good number from palo alto networks saying a lot of good things about demand. remember, that group is one of the worst performing groups, that so-called hack group. it would be night to see that ignited. many of you are fed up with brent saunders and allergan. i say, come o the man has been money. let's give that deal a chance. do i feel he has to do the deal because he's worried about the whole growth angle of allergan running out? no. my whole hope happened he would take the money and go buy a big company. i have to understand -- you have to understand the economics of this deal are too compelling for allergan sreholders to turn down. so, i'm sticking with it for my
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